September 24, 2009

Chicago cabdrivers ask for rate hike, new surcharges

Chicago cabdrivers today asked a City Council committee to raise their overall rates by about 22 percent.

In addition to asking for another 50 cents just to start the ride and another 30 cents per mile driven, drivers want a $1.50 “credit card convenience fee,” $1 for each dispatch telephone call and a $50 penalty for cleaning up a passenger’s vomit.

“If someone throws up in the back of a cab, it’s no laughing matter to the cab driver, who now has to take two hours to detail the cab,” said George Lutfallah, a driver who publishes “Chicago Dispatcher,” a newspaper for cab drivers.

Lutfallah presented statistics that he said showed Chicago drivers make a lower wage than their counterparts in other major U.S. cities. “We are among the lowest paid in the country,” he said.

He spoke before the Transportation Committee, which took the matter under consideration. Representatives of the United Taxi Drivers Community Council also backed the increase.

Afterward, Chairman Thomas Allen (38th) noted testimony that the number of fares per driver has dropped dramatically during the economic downturn, in part because fewer tourists and conventioneers are coming to the city.

“That’s an added burden that’s really outside the control” of the city, he said. “It’s a ticklish situation. . . . People are trying to save money, so they are not taking cabs.”

Mayor Richard Daley said his administration will listen to the drivers' request.

"I just can't say 'yes,' but like anything else, they'll make their presentations. But like anything else, you're very understanding about their plight," Daley said.

But Daley's top aide on the issue wasn't as neutral.

“There is no way in this economy that the consumers, the passengers, can support a 22 percent increase,” Norma Reyes, commissioner of the Business Affairs and Consumer Protection Department, said after the meeting. “The cab drivers are important to the transportation infrastructure of the city, but we are in challenging times.”

Nevertheless, Reyes said she was reviewing all of the information presented today before she makes a formal recommendation.

Cab drivers haven’t received a fare increase since May 2005, though the city last year enacted a fuel surcharge of up to $1 when gasoline costs spike.

University of Illinois Professor Robert Bruno, meanwhile, distributed to aldermen the recently completed first part of a three-phase study, “Driven Into Poverty: A Comprehensive Study of the Chicago Taxicab Industry.”

The study surveyed of 920 of the city’s 12,000 or so cab drivers, found they made less than $5 an hour after paying expenses that included lease and gas payments.

The 711 drivers who completed all parts of the survey reported an average annual income of $54,724 and expenses of $42,403, for a net income of just $12,320.95. They drove average shifts of 13 hours, making their average hourly wage $4.38, the study found. The research included tips.

Allen said the wages are at “poverty level” and don’t even come close to the earnings of workers at Wal-Mart or McDonald’s.

Comments

Weeding through the mostly stupid responses to this article there are a few things that should be addressed.
Firstly, based on whats being written, like 98% of you are complete morons. Terror plots on cell phones? Smelly cabs? "Native" Chicago Drivers? - pure stupidity and blatant racism. Not to mention that most of your "facts" are completely wrong, which makes your moronic opinions that much more idiotic.

The fact is, the drivers are not being open about what they make. If you speak to a medallion owner who drives his own cab, he manages to pay all of the expenses the drivers do, along with a mortgage on the medallion, vehicle insurance, car note, city medallion taxes, among other things, and still does well for himself. Yet drivers somehow can barely scrape by only having to pay for gas and lease fees? A lot of things on here are just false. Specifically:

"greggy p" - There are 6799 medallions in Chicago and 13,585 Medallions in NYC, not 12,00 each. Which means, there is no surplus.
The city doesn't sell medallions. They are traded by license (medallion) holders and increase or decrease in value based on supply and demand.

It seems there are a couple of basic themes in all of these posts:
Talking while driving -
there is no law being broken here, the driver has every right to use a hands free mobiile phone while driving and has no regulatory obligation to do otherwise. If you don't like it, you can politely ask him to stop talking to his wife/parents/children on the otherside of the world so you can get the courtesey that you dont show them. Or, you can hire a personal driver that is more fitting to your high standards. I don't know, perhaps a nice english speaking, pretty smelling, slow driving, good ol boy (confederate flag included) that fits your ignorant view of what a driver should be.

Driving Erratically-
Cabbies have a limited time to make their money, the faster they get anywhere, the quicker they can get the next fare. Anybody who has ever had to earn money based strictly on what they put into the work can understand. Those of you who sit at a desk for 40 hours and get the same salary whether you make 2 spreadsheets or 20 wouldn't.

Discourteous/Smelly Drivers -
Granted, this is offensive. But you have to consider that they spend as much time as they can driving, they look at a 20 minute shower as a missed fare to O'hare ($40).
Also, if you have a job where you commute to work during rush hour for 1, 2, or 3 hours a day know how nerve racking that is. Now imagine 12-16 hours a day of rush hour. Everyday.

Driving a cab is probably one of, if not the last true example of seizing opportunity and succeding while coming from nothingin this country. If you don't have the great priveledge of being born in this country, or speaking this language as articulately as most people, or being able to go to college. But, despite the fact that you come from a place where there is famine, disease, genocide, religeous/ethnic cleansing, and limited freedom, you can still come here, lease a cab, and make a great success of yourself, based on the sweat and work you put in. Even if you have to deal with being treated poorly by drunk brats who take what they have for granted, and feel they can look down at their nose at someone who is doing everyhting he can to earn a dollar to send back to his country and feed his family, you can still do it. Granted, its not as glamourous as going to a city college and working a 9-5, hoping you don't get fired, then getting fired and going on welfare.
There are a lot of former cab drivers who drove cabs 20 -25 years ago and are multi millionaires.

Any fare increase may be followed by taxi companies jacking up the lease rates. Why not lower taxi lease rates (raher than raising fares) so drivers can earn over minimum wage and the public won't get ripped off?

Thirty years ago most drivers were natives because the pay was better, the hours shorter. But public disdain for cabbies isn't new. I recently met a remaining native white driver. He told me that years ago when he met women in nightclubs and they discovered he drove a taxi they usually turned away.

Now that it is insanely expensive to get out of your car anyplace in Chicago, let's raise cab fares too. If I were a Chicago business owner, I'd be outraged. It is too expensive to just get where you are going, before you even sit down for dinner/theater,etc.

I agree with the posts of a few others here:
1)Cab drivers should stay off their cells when driving. Period. I generally ask them to hang up when I get in. I don't talk on the cell when I'm driving, and don't want to pay to be driven by someone doing that. I have had some drivers refuse, or gotten a lot of attitude. At least pretend that you care about the person who entrusted their life to you for a fee for 10 minutes.
2) for all the cabdrivers that don't want a credit card, carry change. I can't tell you how many times I have given a cabbie a 20, only to be told they have no change.
3) I agree with the comment of the writer about cabbies hitting on single women. there is nothing creepier than being alone with a driver who is making creepy comments.

if demand for cabs are down, than we need less cabs on the street rather than raising the price for all that are out there. The majority of workers (that are still employed) took pay cuts last year. We understand that these are tough times that we all have to just get through.

Cab drivers are as a whole inconsiderate drivers and provide poor customer service. They should not be given an increase until they follow the rules posted in every cab including not talking on a cell while driving, knowing how to get around, using the A/C, not having the radio on, etc. NO INCREASE.

Penelope, I agree that being primarily a cash business, the numbers are likely skewed; however, the expenses they are referring to are the costs of doing business, considering they are self employed (gas, lease, fees, insurance) - not the personal expenses you describe such as mortgage, groceries, house bills, etc.

>>Since when is income evaluated "after" expenses?? I
>>consider my income to be my gross income. If I were to
>>factor in mortgage, bills, etc, my income would be slashed
>>in half and be presented MUCH lower than it really is.
>>This is an example of slicing and dicing the data in a way
>>that fits the story you want to tell.

Did anyone else notice the first page of the report? It has 5 cabs lined up idling. A driver is outside standing around. How much can you expect to make if you sit around idle much of the time? I know I would have been fired at my current sales position. Guess what? I pay $200K to my company for overhead just to make my salary. After I pay the $200K in profit back to my company, i start making more than my base salary, which is under 40K. If the cabbies want to make McDonalds wages, they should work at McDs and learn to serve 100+ customers an hour at peak times quickly and efficiently. Plus I highly doubt the cabbies reported their full income. Either afraid of penalty taxes or gaming the survey are my guesses. Plus, if there are 5 cabbies idling outside the Ritz, doesn't that indicate an oversupply?

I will concede, however, that the cab companies are the ones making out like bandits and drivers are def. getting bent over (by the companies). Increasing prices to the customer in a recession, with a vast oversupply of product seems like an inane idea though. The dispatch companies keep renting out equipment because people are still willing to work for $4/hr just to make something and the dispatch company doesn't mind making that extra $50/day profit from leasing it.

I'm fine with a vomit fee, but they seem to want to jack up the prices because fewer people are using their services, which is really dumb. You don't get to raise your prices when people stop using your service to make up the difference, especially since it will lead to more people not using the service.

We already try to use the CTA to get where we are going before cabbing it home late in the evening. Maybe we'll try taking it home too if they want to jack the rates more. I was in Colorado Springs and their cabbies were incredibly friendly and very service oriented. And don't even get me started on the "Black Cabs" in London. Here, while there are certainly some good ones out there, there are plenty of them who are surly, smelly, horrid drivers, or sometimes all three.

In New York the cabs have computers which are tied to the city which issues 1099s so they drivers report accurate income. I think they should do that here. Driving a cab is a cash business & they report what they want.

Almost every time I get in a cab these days, I have to tell the driver where to go because they have no knowledge of the city layout (I'm talking major, well known intersections), they are always on their cell phones and they drive like maniacs. I used to take taxi's to the airport all the time but now I drive and pay the extra money for remote parking. It helps ensure that I return home alive!

The real economic problem for Chicago cab drivers has almost nothing to do with fares. The real problem is supply by far out paces demand. Is there any reason Chicago has as many cab medallions as New York?

There are 12,700 medallions in NYC and according to this article around 12,000 in Chicago. I imagine the demand for cabs in NYC is 3 times greater than Chicago based on population and density.

As of a few years a ago Chicago charged $77,000 for a medallion.

So these FOBs(fresh of the boat) Africans come to Chicago to drive cabs and immediately sign their lives away to get a medallion and then no surprise they are whining about money.

Combine the surplus of medallions with the small business loans the immigrant cabbies take and most of them are essentially modern day slaves.

So here's how it breaks down...
Ultimately the residents of Chicago have terrible cab service
A whole bunch of immigrants spend their lives toiling in cabs
& (drumroll)
the Chicago city council makes huge money selling the Medallions

The problem with fare increases is that the taxi companies follow them by raising the fee drivers pay to lease a taxi. Rather than raising fares, why not legally mandate lower taxi lease rates so drivers can make a decent living, and the public can ride at affordable prices?

Nice to see all our immigrant-haters and taxi driver haters blog in with their nasty, venomous remarks. No wonder most drivers are immigrants (unlike 30 years ago). What native citizen will work a job that combines danger, sub-minimum wages, zero benefits, long hours, and public disdain?

According to the report, the average cabbie works 13.26 hours a shift 25 times a week. Assuming that the average cabbie sleeps 7 hours a night that is 75% of the total time in a single month. That's the *average* which would lead us to believe that many cabbies are working numbers both higher and lower than that.

I bet they were as honest on these surveys as they are when they tell you their credit card machine is broken or that they don't know where Ashland and Montrose is. Is it possible that people employed in a mostly cash business were not honest with their answers?

It's also interesting that only 81% of the respondents felt that a fare increase was necessary. One has to assume that the 28% of cabbies who lose money driving a cab voted this way. That leaves 47% of cabbies making, on average, less than minimum wage who feel that they should not be making more money. This report is as factual as a Loch Ness monster photograph.

There is nothing worse than getting into a cab, the driver having horrible body odor, and not being able to roll the windows down because they've been locked by the driver! So many smelly experiences in Chicago cabs, I want to vomit just thinking about them.

Who and what is behind the expense portion (other than fuel) for Chicago cab-drivers? I guess we can't go there...

I'm from London and Chicago cabs are ridiculously cheap compared to a London Black Cab. However, London cabs are spotlessly clean, the drivers past very stringent tests (including the famous 'knowledge'), know every hotel, station, theater and everything else in the City. Not so much the average Chicago Taxi. I think that its reasonable for the Taxi drivers to ask for fare increases, but equally its fair that this is balanced by much stricter enforcement of existing laws & regulations. No more cutting people off in traffic, no more treating cyclists as targets (whilst cycling with my wife, one cab tried to deliberately run us off of the road), no more blowing red lights, pushing their way onto busy cross-walks, blocking streets and generally behaving like they own the road. You want to charge more? Then offer a better service to go with those fees.

I wonder if the drivers were being honest in their responses? Here's one clue that they weren't:
"A sizeable minority (28.1 percent) of drivers are actually losing money. That is, their business expenses exceed their income."

So according to the report, 28% of cab drivers work 13.26 hour shifts 25 days a week only to LOSE money? That's nearly a third of cab drivers who apparently spend 331.5 hours of their time a month losing money. Why would they bother doing a "job" that only accrues debt? These results sound very accurate to me!

I would be willing to pay double if the cabs had to follow these rules:

1. If they change langes without a signal they are fined $10
2. If they blow a red light they are fined.
3. If they blow their horn excessively they are fine.
4. If they take off from a stoplight like they are drag racing they are fined for wasting fuel.
5. Fined for driving over the speed limit.
6. If talking on cell phone while moving they would lose their right to drive for one day.

This would all be very easy to do using GPS and cell phone technology. The cell phone can report the data directly to the city and the city would issue a bill attached to the cabbies licence tag.

All 50 aldermen on the Chicago City Council had to file paperwork earlier this year detailing their outside income and gifts. The Tribune took that ethics paperwork and posted the information here for you to see. You can search by ward number or alderman's last name.

The Cook County Assessor's office has put together lists of projected median property tax bills for all suburban towns and city neighborhoods. We've posted them for you to get a look at who's paying more and who's paying less.

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